Voluntary After-Tax Contributions Limit

Submitted by IRAQuestion5 on Mon, 2025-03-17 15:39

Hello-

Husband owns business that flows to Schedule C and nets about $30K. Wife also works in business and gets W2 but no other employees. Husband maxes out employee deferral 401k at other unrelated employer.

  1. Can the husband contribute 100% of net Schedule C ($30K) via Voluntary After-Tax contribution to a Solo 401k (if provider allows for after-tax contribution)?
  2. Can this be done for 2024 with a new Solo 401k plan set up now?

Thank you!



Submitted by Alan - IRA critic on Tue, 2025-03-18 12:13

20% of net income less 1/2 SE tax is the max after tax contribution allowed if the plan allows after tax contributions.

However, Sec 317 of Secure 2.0 only allows elective deferrals to be made to a plan adopted for the prior year. After tax contributions are not elective deferrals, and husband has maxed out 2024 elective deferrals, therefore it appears that no contributions can now be made for 2024. Perhaps he should consider a SEP IRA contribution for 2024.

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